Smt. Prakash Kaur vs State Bank of India

P.K. Bhasin Chairperson

ORDER ON WAIVER APPLICATIONS

The appellants have suffered a money decree for a sum of Rs.1996,56,03,949/- in an O.A. filed by respondent no.1 bank under section 19 of the Recovery of Debts and Bankruptcy Act, 1993. The appellants claimed it to be an ex parte final order and accordingly it moved an application under Order IX Rule 13 CPC(I.A. No. 173/2019) for recalling the final order passed by the DRT. The DRT, vide impugned order, set aside the ex parte final order but imposed a condition of appellant depositing a sum of Rs.22.96 crores for which one of the mortgaged properties had been auctioned. This amount was to be paid within 30 days. The appellants filed appeal no.83/2021 challenging the said order of DRT passed on 16.12.2019. The appellants have felt aggrieved by this condition which they considered very harsh and could not be complied with.

The appellants moved another application for extension of time by 90 days to comply wit the direction dated 16.12.2019. That application was dismissed vide order dated 27.1.2021 against which Appeal No.22/2021 was filed.

In order to entertain the appeals, the appellants are required to make a pre-deposit of 50% of the amount of debt adjudicated against them by the DRT. However, the appellants being under the impression that no pre-deposit is required to be made when only an appeal challenging the harsh condition imposed on them is filed. According toMr. Pallav Saxena, learned counsel for the appellants submitted that condition of pre-deposit is not attracted in the facts of the present case. In support of this submission, he relied upon one judgment of the Hon'ble Allahabad High Court and one judgment each of the DRAT, Delhi and DRAT, Kolkatta. Those judgments are reported as:

Jai Gopal Kansal & Ors. vs. Indian Bank & Ors., II (2019) BC 399 (All)

Kailsah Chand Nagpal & Ors. vs. Corporation Bank & Ors., II (2004) BC 1

New Indian Assurance Co. Ltd. vs. Union Bank of India, I (2007) BC 40

However, this submission of Mr. Pallav Saxena, leaned counsel for the appellants that since the appellant is not claiming setting aside final order of DRT, which DRT itself has set aside but condtion imposed on the appellants is veryh harsh and for challenging order appellants are not required to make any pre-deposit is liable to be rejected in view of the recent judgment of the Hon'ble Supreme Court in "Kotak Mahindra Bank vs AmbujKasliwal" , reported in 2021(3) SCC549. In that case referring to Section 21 of the Recovery of Debts and Bankruptcy Act,1993regarding pre-deposit observed as under:-

"A perusal of the provision which employs the phrase "appeal shall not be entertained" indicates that it injuncts the Appellate Tribunal from entertaining an appeal by a person from whom the amount of debt is due to the Bank, unless such person has deposited with the Appellate Tribunal, fifty percent of the amount of debt so due from him as determined by the Tribunal under Section 19 of the Act. The proviso to the said Section, however, grants the discretion to the Appellate Tribunal to reduce the amount to be deposited, for reasons to be recorded in writing, but such reduction shall not be less than twenty five per cent of the amount of such debt which is due. Hence the pendulum of discretion to waive predeposit is allowed to swing between fifty per cent and twentyfive per cent of the debt due and not below twentyfive per cent, much less not towards total waiver. It is in that background, keeping in perspective the said provision, the DRAT has in the instant case ordered deposit of fifty per cent of the amount............................"(emphasis supplied)

This judgment does not make any distinction between an appeal against an appeal against final order or an order imposing costs while setting aside ex pare final order in which liability of borrowershas been adjudicated. In both the categories the appellant wants setting aside final order. In this case the liability of the appellants has been adjudicated by the DRT and appeal is filed in such a case that appeal can be entertained only if pre-deposit of 50% of the debt so adjudicated by the DRT is to be made. The DRAT has the discretion of reducing the pre-deposit only upto 25% for reasons to be recorded in writing. The appellant have not claimed waiver of 25%. So, persuading me to make two category of cases for the purposes of pre-deposit for the entertainment of statutory appeal is to persuade me to defy the mandate of Apex Court. This Tribunal is bound by this decision of Supreme Court and the judgments taking a contrary view, as cited by Mr. Pallav Saxena, need not now be consideredin view of the latest pronouncement of the Hon'ble Supreme Court in AmbujKasliwal's judgement(supra).

Accordingly, I call upon the appellants to make a pre-deposit of 50% of the decretal amount inclusive of pendente liteinterest as awarded by the DRT. The appellants shall make a pre-deposit of 50 crores of the total pre-deposit amount within a week and the balance pre-deposit can be made within three weeks thereafter. In case pre-deposit is made, the same shall be kept in a fixed deposit with a nationalized bank. However, in case the pre-deposit of 50 crores is not paid within a week the appeals will be liable to dismissed, and the balance pre-deposit can be made within three weeks thereafter. The pre-deposit will be required to be made only in ob

Ne appeal.

The appeals shall be put up now for seeing the compliance of pre-deposit on 6.10.2021.